RTTNews - While the Commerce Department released a report on Thursday showing a modest increase in new home sales in the month of April, the sales growth came amid a notable downward revision to the pace of sales in March.
The report showed that new homes sales edged up 0.3 percent to an annual rate of 352,000 in April from a revised 351,000 in March. Economists had expected sales to rise to 360,000 from the 356,000 originally reported for the previous month.
With the downward revision, new home sales in March were down 3 percent compared to an upwardly revised 362,000 in February.
The modest increase in new home sales in April came as a 1.9 percent increase in sales in the South was partly offset by a 3.8 percent decrease in sales in the West. Sales in the Northeast and the Midwest were unchanged compared to the previous month.
While the report also showed that the median price of new houses sold in April rose to $209,700 from $202,200 in March, the median price is down 14.9 compared to the same month a year ago.
The Commerce Department added that the estimate of new houses for sale at the end of April was 297,000, down 4.2 percent from 310,000 in March.
New houses for sale at the end of the month represent a supply of 10.1 months at the current sales rate. This is down from 10.6 months of supply in the previous month and marks the lowest level since a matching number in July of 2008.
Peter Boockvar, equity strategist at Miller Tabak said, Net-net, while this is an important read on the housing market, existing home sales make up more than 80 percent of all sales, thus making yesterday's data point more relevant to the markets.
Wednesday morning, the National Association of Realtors released a report showing that existing home sales rose slightly more than expected in the month of April.
The report showed that existing home sales rose 2.9 percent to an annual rate of 4.68 million units in April from a downwardly revised rate of 4.55 million units in March. Despite the monthly increase, existing home sales were down 3.5 percent year-over-year.
Economists had expected sales to rise to a 4.66 million unit rate from the 4.57 million unit rate originally reported for the previous month.
While the pace of existing home sales increased compared to the previous month, total housing inventories at the end of April represented a 10.2-month supply compared with a 9.6-month supply in March.
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